Why Gender-Based Pay Gaps Exist

August 03, 2016

by Carla Smith, MA, FHIMSS, CNM, executive vice president, HIMSS

In an August 2, 2016 blog, I provided a brief overview of the historical (and current) pay gap between men and women in the United States. While the overall compensation gap in the U.S. has improved dramatically since our nation’s early years when women earned approximately 30% of a male peer’s wage, today’s full time working women on average only earn 79¢ for every $1.00 a male peer earns. We’ve still got a long way to go.

Widening of the Gender Wage Gap - This is especially true for the health IT field. HIMSS’s recent analysis, based upon self-reported data collected between 2006 and 2015, shows that the gender wage gap has actually widened in the past decade. In 2006, women on average reported earning 80¢ for every $1.00 a male peer reported. In 2015, women responding to our survey reported earning 78¢, meaning the gap had widened by 2.7%.

With a few exceptions, the Equal Pay Act of 1963 prohibits gender-based wage discrimination between workers in the same establishment who perform jobs that require substantially equal skill, effort, and responsibility, and performed under similar working conditions. Those exceptions include establishments that use systems such as seniority, merit, or measuring earnings by quantity of output / quality of work.

How is that possible? How, in the new millennium, in a field that is as vibrant as heath IT in the United States, is it possible that the gap has actually widened?

Understanding the Pay Gap - As with most conundrums, the answer at first may appear simple – even self-evident. It’s easy to think that the answer is a very clear-cut “Because employers discriminate.” And the reality is, there is evidence to support that statement: wage discrimination based upon gender – whether intentional or not – does exist and does play a factor in the pay disparities we see today. But, that’s not the only reason; there are several factors at work accounting for the gap. While this post cannot provide an exhaustive discussion on this subject, I can highlight a few factors to shed some light on the challenges (and opportunities) ahead in our journey toward pay equity.

Recognizing Gender Dominance and Salary Opaqueness - One factor involves gender-dominance in occupations (think construction and child care): male-dominated occupations earn, on average, more than female-dominated occupations. Opaqueness in employers’ salary information is another factor. As I stated in last week’s blog, “knowledge precedes improvement”; lack of transparency makes it more difficult to ensure equity-based compensation behaviors.

Employer Retribution - A third closely-related factor surrounds the fears employees have of retribution by their employer for sharing salary information with one another. Very recently, I heard a story from two millennials, hired on the same day to do the same work for the same employer (a pizza delivery business). The male was hired at $8.21 an hour, while the female was hired at $8.00. As these two were friends, they excitedly called each other and, in the course of the conversation, learned of the wage disparity. With her friend’s full support, the woman called their new employer to find out why she was hired at a lower wage than her friend to do the same job. Both were fired for talking about their salary.

Caring for Dependent Family Members - Another significant cause of the wage gap between the genders is women leaving the work world to care for a dependent family member (e.g. raising children or caring for aging parents). They lose the years of work experience that would otherwise help them grow and expand their earnings. When they return to work, their lack of recent work history and skill acquisition/practice reduces their value in the marketplace.

Knowing What You’re Worth - Finally, workers (men and women) lack knowledge about what they are worth. Many of us, when applying for positions, either do not seek data on the compensation the market will bear for the positions we seek, or we can’t find any data. Fortunately, in health IT we have a credible source of data. Our most recent biennial compensation study, based upon data gathered in late 2015, was published in early 2016. When we know our worth, we can effectively negotiate a fair and equitable wage. But, that’s not the only component – once we know our worth, we need to empower ourselves to negotiate when offered a position.

Knowledge precedes improvement - When you know your worth, you can use that knowledge to advantage.

We want to hear your stories. Tell us about how you learned your worth, your re-entry into the work world, and your experience of achieving pay equity in the health IT field.

Now that we understand the history of gender pay inequity, and have explored some of the reasons those inequities exist, I’ll be discussing what we can do to eliminate the gap in our sector. I hope you stay with us and join in the discussion.